Charting on course: Bids bring sigh of relief to LHS Building Committee

3/13/2019

Charting on course: Bids bring sigh of relief to LHS Building Committee

Construction crews work on the foundation for a new classroom addition on Lincoln High School, to include a new dining commons, media center, guidance and nurse’s suite. Providing a budget update, the project team said the project is currently running roughly $768,000 over estimate. (Breeze photo by Nicole Dotzenrod)

LINCOLN – Offering a status update regarding the budget for Lincoln High School’s construction/renovation, Derek Osterman of Colliers International said the project was “trending in the right direction” last week after securing significant savings on some recent bid packages.

“My overall impression of how we’re doing is good … we’re in the neighborhood we need to be in,” he said. “Coming out of the hard decisions we made on May 30, the project is healthy.”

He was referring to the Building Committee meeting that was held last May, during which the project team approved a list of optional cuts to bring construction costs back in line with the project budget.

Cost estimates at the design development phase of the project came in much higher than the initial $50.3 million appraisal, with consultant Daedalus estimating the project would cost more than $53 million, and Gilbane estimating it would cost more than $55 million.

In an effort to reconcile the numbers, the committee made a number of cuts/alternates last spring, including:

They also made several budget transfers, including $910,000 of $960,000 from the furnishings and equipment budget line to the construction line item, and $860,000 of $960,000 from the technology equipment budget line to the construction line item.

The project team did not remove 100 percent of the furnishings from the budget, but did set aside most of the furniture budget until the final construction numbers come in.

Committee Chairman Arthur Russo said some difficult decisions had to be made at that time, but that the committee chose to “temporarily “value-engineer” items that could be reincorporated back into the budget as the total financial picture moves from estimated to firm.” For example, furniture, fixtures and equipment could easily be reincorporated as the project develops, Russo said.

During last May’s meeting, construction Manager Charles Roberts of Colliers, said the project team had considered what it believed to be all possible alternatives to close the budget overage, and that the value engineering recommendations were being made based on the fact that the reductions would not change the overall building footprint and utilities would still be fully replaced.

Roberts said the only option equivalent in savings to all of the proposed value engineering options would have been not to renovate the existing two-level wing at the center of the campus. The alternates approved by the committee are structured in a way that allows members to revisit them should bid results prove to be more favorable than estimated.

After making more than $3 million in cuts, the construction target coming out of that May meeting was $52,075,000. As of February, the target had risen to $52,460,600, with 70 percent of the project’s bids procured.

The project team released a statement to The Valley Breeze last week that the project’s current financial status could be summarized by stating that “the project cost is presently running approximately $768,000 overestimate, with other bid results still pending over the next few weeks and without, at the present time, consideration of additional value engineering initiatives and contingency budget line items.”

The total project contingency was $2,569,520 in November 2018, and $2,193,700 last month. Remaining bids for the project total more than $13 million.

The committee was optimistic about its February bid packages, saving nearly $2 million. While bids for roofing, glass and glazing and kitchen equipment came back higher than expected, the committee saw savings in fire protection equipment, plumbing, HVAC and electrical systems.

Many members of the committee asked about the possibility of revisiting and adding back value-engineered items. Russo expressed concerns about reusing old furniture in the auditorium, while Principal Kevin McNamara inquired about the timeline for making those decisions. “At what point has the train left the station?” he asked.

Osterman said he would be able to provide a better analysis once the final bids begin to come in around late March or April. He admitted that there are a few items that are “probably completely off the table,” but said he would have to go back and look at the list.

McNamara said it seems like the project is tending in a positive direction, but “we still have minimal furniture, fixtures and technology. I really think we cannot open a new building with a 1988 desk and 2012 projector ripped out and installed in a brand new room.”

He said he understood the restrictions of the project budget, but wants to be sure “through this project or School Department operating funds that we’re planning to outfit the building for 2021 and not digging equipment out of trainers that will be almost 10 years old when the building opens.”

In terms of timeline, Osterman said the project was running on schedule, with crews actively looking at the possibility of finishing ahead of schedule.